Good Company

Business Litigation

Picture this: you’re an insurance company that has just received notice of a claim from one of your insureds. You provide coverage under the terms of the policy. Subsequently, you find out that your insured also has coverage from another insurer, but your insured never notified them of the claim. You provide notice to the other insurance company and seek equitable contribution, but the other insurance company refuses to contribute. It seems outrageous-can they do that?!

Many businesses are initially reluctant to engage in mediation, opting instead for an aggressive litigation posture. Yet, more than ninety percent of business cases ultimately settle, and many of these resolve through mediation. While litigation may be the best vehicle to resolve some cases, in others a successful mediation can save time and the parties expenses as well as avoid the uncertainties of litigation.

New Hampshire physicians, architects, engineers and many other professionals are regulated by administrative licensing boards. For those professionals, a state-issued license represents their livelihood. The Appeal of Boulard, a recent decision by the Supreme Court of New Hampshire, clarifies important legal principles that affect any professional facing investigation or disciplinary action.

A long-term care resident’s fiduciary fails to apply for Medicaid, creates a Medicaid penalty period by transferring the resident’s assets, or fails to pay the resident’s patient pay amount. Until recently, long-term care facilities were left holding the bag. A recently-passed law gives long-term care facilities a new tool for collecting that debt.

It is a generally recognized principle of law that a company purchasing the assets of another company does not assume liability for the selling company’s debts. Under the state law doctrine of successor liability, however, there are several different theories under which the selling company’s liabilities could be imposed upon the buying company. Because of this and other purchasing risks, buyers of assets of financially distressed companies have more and more frequently elected to have “free and clear” sales conducted through bankruptcy proceedings. But recent case law should put prospective purchasers of assets in bankruptcy sales on notice of the continued risk of potential successor liability claims, notwithstanding a sale order that absolves the buyer of any of the seller’s liabilities.

Businesses often record and monitor telephone calls involving their customer service representatives or call center agents for quality control or quality assurance purposes. That practice is subject to federal and state wiretapping laws, which apply to the electronic recording of telephone calls. Businesses, therefore, should understand and comply with call recording laws. Failure to do so may result not only in a civil claim for money damages, but also criminal prosecution.

Particularly in today’s cyber-based economy, it is common for persons to work at home – even those engaged in substantial businesses. What many might not know is that local zoning laws and regulations may severely restrict or even prohibit those activities. When considering a home based business, it is very important that local zoning laws be carefully reviewed to make sure you are not inadvertently overstepping the law.

Companies often assert in litigation and to their employees that they possess a “customer list,” and that the customer list is a “trade secret.” The case law makes clear that a customer list is only a trade secret when imbued with information that others cannot otherwise or easily replicate. This article provides examples of customer lists that are and are not trade secrets, within the meaning of the Uniform Trade Secrets Act, and tips on how to build and protect the competitive value of a customer list that is a trade secret.

Several years ago, in the July 2007 edition of Good Company, we highlighted for employers ten common mistakes that threaten the enforceability of non-compete agreements. One of those common mistakes – Failing To Update Your Agreements To Comport With Changing Laws – prompts us to remind employers of a new change in the law. Additionally, in light of more recent case law and reflection on the topic, we highlight two additional mistakes for the unwary and offer best practices for avoiding related trouble.

In the course of completing your due diligence into a company you want to buy, you and your counsel evaluate many things, one of which should be the people employed by the target company. Expecting the deal to close, clients of mine often start the process of evaluating the performance of the employees they will “acquire” in the transaction, any territorial overlaps among existing and “acquired” employees, and other factors relating to this overriding question: “After we close this deal, who do we want to keep?”

Employers commonly require employees to sign agreements containing restrictive covenants. These include non-competition agreements, in which the employee promises not to work for a competing venture after departure. Many employers require non-disclosure agreements, which prevent a former employee from divulging or utilizing the employer’s confidential information. Finally, employers often require non-solicitation agreements, in which the former employee is prohibited from contacting clients and/or co-employees with the intention of diverting them away from the company.